AUSTIN, TX — Opportunity Finance Network — a leading national network of community development financial institutions — announced on Thursday that Austin-based PeopleFund was recipient of capital to support small businesses amid the coronavirus.
PeopleFund was one of four community development financial institutions (CDFIs) benefiting in the first round of Grow with Google Small Business Fund loans and grants from Google.org, officials said. PeopleFund will use the capital to support small businesses in its service area that were the hardest hit from economic loses stemming from both coronavirus and civil unrest stemming from police abuse protests, according to a news advisory.
PeopleFund creates economic opportunity and financial stability for underserved people by providing access to capital, education and resources to build healthy small businesses, officials explained. For over a quarter century, PeopleFund has disbursed close to $100 million in micro, SBA 504 and small business loans to more than 1,500 small businesses and non-profits, creating or retaining close to 7,400 jobs along the way, officials said.
The vast majority of PeopleFund’s clients are women, low and moderate-income people and minorities, officials noted, and one of four loans disbursed by PeopleFund are for veteran entrepreneurs. During the pandemic, PeopleFund has collaborated with multiple organizations and cities to offer disaster relief products and free business coaching to small businesses across the state of Texas, according to the advisory.
Launched in March, the Grow with Google Small Business Fund delivers financing to CDFIs like PeopleFund that are supporting the short-term recovery and long-term financing needs of America’s small businesses affected by COVID-19, officials said.
On Monday, Google’s CEO Sundar Pichai announced the company will provide Opportunity Finance Network (OFN) an additional $45 million in loans on top of the Fund’s original $125 million to assist black-owned small businesses. In total, officials said, Google has now committed $170 million in loans.
In addition, Google.org has made a $10 million grant to OFN to enable its member CDFIs to improve access to capital for the most marginalized communities, officials added. The unrestricted grants can support operations, loan capital, loan loss reserve, capacity building, or any other purpose.
“Small businesses are the backbone of our economy,” PeopleFund’s President and CEO Gustavo Lasala said in a prepared statement. “CDFIs are in a unique position to ensure that as many small businesses as possible have the resources and support they need to navigate through this crisis and rebuild in the new normal. PeopleFund will put this patient capital to work in low and moderate income communities and true to our mission, these funds will be used to make a positive difference for those businesses and communities that have been hit the hardest by the current crisis.”
The other first round of loan and grant awardees are Citizens Potawatomi Community Development Corporation; Grameen America; and Opportunity Fund.
Lisa Mensah, president and CEO of OFN, said CDFIs bridge the gap created by mainstream financing sources: “CDFIs are America’s best community lenders with 40 years of experience providing capital where mainstream finance can’t or won’t. Today, CDFIs are vital to ensuring a more even recovery for America’s small businesses.”
Mensah lauded Google’s efforts: “We applaud Google for stepping in to help bridge deep gaps in access to capital for minority and women-led small businesses. Google’s significant investment and grant helps CDFIs to combat economic inequity during a national health and economic crisis that has been recently compounded by civil unrest.”
Added Google CEO Ruth Porat: “The Grow with Google Small Business Fund and Google.org grants are some of the key investments that Google is making in the future of America’s small businesses. Our economy requires that small businesses prosper,” said. “The COVID crisis has created unprecedented challenges for many small businesses, and we are committed to assisting them. We’re proud to have an outstanding partner in OFN to provide loans and grants to CDFIs who are on the front lines of the economic recovery effort.”
Borrowers can head to peoplefund.org for more information, and can apply for a loan now on peoplefund.org/apply.
There are more than 1,100 CDFIs working in all 50 states, the District of Columbia, Guam, and Puerto Rico. OFN’s more than 300 members serve 58 percent people of color, 85 percent low-income, 26 percent rural, and 48 percent women (OFN Annual Member Survey, 2018). Nationwide, the CDFI industry manages more than $222 billion.
OFN, a leading national network of CDFIs, strives to ensure low-income and other under-resourced communities have access to affordable, responsible financial products and services. Members of OFN are CDFIs that deliver responsible lending to help low-income communities join the economic mainstream.
Through 2018, OFN’s network originated $74.2 billion in financing in rural, urban, and native communities. This financing has helped to create or maintain more than 1,560,000 jobs, start or expand more than 419,177 businesses and microenterprises, and support the development or rehabilitation of 2.1 million housing units and more than 11,500 community facility projects.
For more information, visit www.ofn.org.
Google describes its mission as one to organize the world’s information and make it universally accessible and useful. Through products and platforms like Search, Maps, Gmail, Android, Google Play, Chrome and YouTube, Google plays a meaningful role in the daily lives of billions of people and has become one of the most widely known companies in the world. Google is a subsidiary of Alphabet Inc.
Google.org, Google’s philanthropy, supports nonprofits that address humanitarian issues and apply scalable, data-driven innovation to solving the world’s biggest challenges, officials said. “We accelerate their progress by connecting them with a unique blend of support that includes funding, products, and technical expertise from Google volunteers,” officials wrote. “We engage with these believers-turned-doers who make a significant impact on the communities they represent, and whose work has the potential to produce meaningful change. We want a world that works for everyone — and we believe technology and innovation can move the needle.”
This article originally appeared on the Austin Patch